On the Ground at ACAMS: Human Trafficking in the Illicit Massage Business

LAS VEGAS — You are walking down the street in the trendy DTLA, (a.k.a. downtown Los Angeles) and feeling a bit tense after a long day at work. So, you think to yourself, “I could really go for a Swedish massage.” You begin scrolling through Yelp when suddenly you look up from your mobile device and spot a sign in a window fortuitously calling out to you, “Panda Massage, $20/hr.” You’ve had a lot of massages in your life, but something tells you that the below market rate of $20 an hour won’t get you the legitimate, therapeutic benefits you had in mind.

In fact, you may have just stumbled upon an illegal sex business. Illicit massage parlors are one of several types of businesses that human traffickers use to make a profit. Those profits are all part of a money-laundering scheme where monies flow back to the criminal enterprise in a never-ending cycle; never-ending unless we do something to disrupt the criminals.

Rochelle Keyhan, Director of Disruption Strategies at Polaris, speaks at the ACAMS panel on human trafficking.

At the recent ACAMS 17th Annual AML & Financial Crime Conference in Las Vegas, panelists from law enforcement, the non-profit Polaris Project, the financial sector, and Thomson Reuters Special Services (TRSS), discussed commercial sex trafficking in the United States and ways to disrupt it. The panel, Crafting Detection and Investigation Systems to Fight Human Trafficking, was moderated by Michael Greenman, Senior VP and Chief Counsel of Financial Crimes Legal at US Bank; and included panelists Marcy Forman, Managing Director for the Global Investigations Unit, AML Compliance, for Citigroup; Rochelle Keyhan, Director of Disruption Strategies at Polaris; John F. Tobon, Deputy Special Agent in Charge, Homeland Security Investigations (South Florida); and Peter Vincent, General Counsel of Thomson Reuters Special Services and Assistant Director General International Policy for BORDERPOL.

Illicit Massage Parlors

The illicit massage industry is big business for sex traffickers. According to statistics from Polaris, massage parlors generate more than $2.5 billion in annual profits — profits made because of human bondage. “There are over 9,000 illicit massage parlors currently open for business in the U.S” said Polaris’ Keyhan, pointing out that the principal indicators that a business is selling commercial sex and is a possible human trafficking venue include:

Prices for massages significantly below market;

Serves primarily or only male clientele, and is open 24 hours a day;

Locked front door, customers can only enter if buzzed in or through discreet back or side doors;

Covered or blacked out windows; and

Women appear to be living in the establishment

Stay Current on the Fight Against Human Trafficking

We all play a part in stopping human trafficking. Financial institutions, law enforcement and non-profits continue to find ways to partner to help disrupt the serious issue of human bondage. Stay up-to-date on progress and trends from industry specialists by following the Risk & Compliance page.

Working with Law Enforcement: Public-Private Partnerships

There are concrete steps financial institutions take to effectively identify and disrupt human trafficking. Forman from Citigroup outlined both internal steps that institutions can take — such as focusing on business sectors that are more vulnerable to abuse (night clubs, spas, and employment agencies) and educating first-line personnel and staff about what she described as “face-to-face” indicators — to more external steps, including partnering with law enforcement and NGOs to obtain information about human trafficking and utilizing the USA PATRIOT Act where appropriate.

John Tobon (l), of Homeland Security Investigations; and Peter Vincent (r), of Thomson Reuters Special Services.

Shutting Down Backpage.com: Did it Help or Hinder Law Enforcement Investigations?

Human trafficking investigations can be challenging and labor intensive, the panel said. Identifying victims is one of the top issues surrounding these investigations, simply by the covert nature of the business.

TRSS’ Vincent noted that when Backpage.com was shut down, it actually removed an investigative tool from law enforcement’s arsenal. “Shutting down Backpage.com, although righteous, effectively removed a critically important investigative platform that was heavily leveraged by law enforcement,” Vincent from TRSS stated.

Yet, Backpage.com is not the only online platform used to facilitate commercial sex transactions in sex trafficking cases. Internet-based commercial sex cases also involved the use of Facebook, Craiglist, MyRedBook, Instagram, KiK Messenger, Tagged, Eros, Adult Friend Finder, Pinger, Executive Companion, and several others, according to the report.

Financial Institutions Key Takeaways

The issue of human trafficking in the massage sector and other businesses is complicated beyond what a one-hour ACAMS panel or blog post can solve. Yet, there are some key takeaways for financial institutions that panelists outlined, including:

Gina (Scialabba) Jurva, Esq., is the Manager of the Risk & Compliance platform for the Thomson Reuters Legal Executive Institute. Gina works on solutions to some of the world’s most pressing fraud issues including anti-money laundering (AML), e-commerce fraud, and healthcare fraud, in addition to risk and regulatory compliance.

In a previous role at Thomson Reuters, Gina worked as a Senior Legal Writer and Editor. Additionally, she spent a combined 11 years as a deputy district attorney handling both misdemeanor and felony cases and later, her own legal practice defending clients in criminal matters.

Gina graduated from Santa Clara University with a BA in English and a minor in Medieval and Renaissance Studies. She later obtained her law degree with dual specialization certificates in criminal law and litigation. She recently graduated from the Women’s Campaign School at Yale University.

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